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The automotive industry is experiencing unprecedented growth, with increasing demand for both new and used vehicles. Now is the perfect time to enter this lucrative market.
High Profit Potential
Average dealership profit margins of 15-20% with potential for significant growth as you establish your customer base.
Growing Market
Used car sales continue to outpace new car sales, with increasing consumer preference for pre-owned vehicles.
Complete Support
Our comprehensive platform provides everything you need: licensing, software, training, and ongoing support.
Follow our comprehensive roadmap to dealer licensing success. Each step is designed to ensure compliance and set your business up for long-term success.
01. Research State Requirements
01. Research State Requirements
Understand the specific licensing requirements for your state and determine which type of dealer license you need.
📋Requirements
- •Identify your state's motor vehicle dealer board
- •Determine license type (new, used, wholesale, etc.)
- •Review state-specific regulations
- •Understand zoning requirements
📄Key Documents
- •State dealer licensing guide
- •Zoning compliance documentation
- •Business plan template
💡Pro Tips
- →Start with your state's DMV or motor vehicle dealer board website
- →Consider hiring a local business attorney familiar with dealer licensing
02. Establish Business Entity
02. Establish Business Entity
Form your business legal structure and obtain necessary business registrations.
📋Requirements
- •Choose business structure (LLC, Corporation, etc.)
- •Register business name
- •Obtain Federal EIN
- •Register with state business department
📄Key Documents
- •Articles of Incorporation/Organization
- •Operating Agreement/Bylaws
- •EIN confirmation letter
- •Business registration certificate
💡Pro Tips
- →LLC is most common for small dealerships
- →Consider tax implications of business structure
03. Secure Business Location
03. Secure Business Location
Find and lease/purchase a compliant business location that meets all state requirements for auto dealers.
📋Requirements
- •Commercial zoning compliance
- •Minimum square footage requirements
- •Customer parking availability
- •Display area for vehicles
📄Key Documents
- •Lease agreement or deed
- •Zoning compliance certificate
- •Certificate of occupancy
- •Site plan/layout
💡Pro Tips
- →Verify zoning allows auto sales before signing lease
- →Consider visibility and traffic patterns
04. Obtain Surety Bond
04. Obtain Surety Bond
Secure the required surety bond amount as mandated by your state (typically $25,000-$100,000).
📋Requirements
- •Meet state minimum bond amount
- •Pass credit check for bond approval
- •Provide business and personal financial information
📄Key Documents
- •Surety bond certificate
- •Bond application
- •Financial statements
💡Pro Tips
- →Shop multiple bond companies for best rates
- →Maintain good credit for better bond rates
05. Secure Insurance Coverage
05. Secure Insurance Coverage
Obtain all required insurance policies including general liability, garage liability, and errors & omissions.
📋Requirements
- •General liability insurance
- •Garage liability coverage
- •Errors & omissions insurance
- •Property insurance for location
📄Key Documents
- •Certificate of insurance
- •Insurance policy declarations
- •Additional insured endorsements
💡Pro Tips
- →Work with agent experienced in auto dealer insurance
- →Understand coverage limits and deductibles
06. Attend Pre-License Seminar
06. Attend Pre-License Seminar
Complete mandatory pre-license education seminar covering dealer laws, regulations, and business practices.
📋Requirements
- •Attend state-approved seminar
- •Pass examination (if required)
- •Obtain completion certificate
📄Key Documents
- •Seminar completion certificate
- •Exam results (if applicable)
💡Pro Tips
- →Take detailed notes during seminar
- →Network with other prospective dealers
07. Prepare License Application
07. Prepare License Application
Complete comprehensive dealer license application with all supporting documentation.
📋Requirements
- •Complete application forms
- •Background check authorization
- •Financial statements
- •Personal and business references
📄Key Documents
- •Dealer license application
- •Personal financial statement
- •Business financial statements
- •Background check forms
💡Pro Tips
- →Double-check all information for accuracy
- →Organize documents in order requested
08. Submit Application & Pay Fees
08. Submit Application & Pay Fees
Submit completed application package with all required fees to state licensing authority.
📋Requirements
- •Application fee payment
- •License fee payment
- •All supporting documents
- •Proof of bond and insurance
📄Key Documents
- •Fee payment receipts
- •Application submission confirmation
- •Complete application package
💡Pro Tips
- →Submit via certified mail or in person
- →Keep proof of submission
09. State Inspection
09. State Inspection
Pass state inspection of your business location and operations setup.
📋Requirements
- •Clean, professional business appearance
- •Proper signage displayed
- •Required licenses and certificates posted
- •Office setup with customer area
📄Key Documents
- •Inspection checklist
- •Posted licenses and certificates
- •Business signage permits
💡Pro Tips
- →Prepare location well in advance
- →Have all documentation readily available
10. License Approval & Issuance
10. License Approval & Issuance
Receive official dealer license approval and license certificate from the state.
📋Requirements
- •Pass all state requirements
- •Complete application processing
- •No outstanding issues or deficiencies
📄Key Documents
- •Official dealer license certificate
- •License number assignment
- •Operating authority documentation
💡Pro Tips
- →Frame and display license prominently
- →Understand license renewal requirements
11. Setup Dealer Platform & Systems
11. Setup Dealer Platform & Systems
Implement dealer management software, documentation systems, and operational procedures.
📋Requirements
- •Dealer management software
- •Document management system
- •Customer database setup
- •Inventory tracking system
📄Key Documents
- •Software licensing agreements
- •System setup documentation
- •User training materials
💡Pro Tips
- →Choose integrated platform for efficiency
- →Ensure compliance with state record-keeping requirements
12. Begin Operations & Compliance
12. Begin Operations & Compliance
Start dealership operations while maintaining ongoing compliance with all regulations.
📋Requirements
- •Maintain proper records
- •File required reports
- •Renew licenses and permits
- •Stay current with regulation changes
📄Key Documents
- •Monthly/quarterly reports
- •Renewal applications
- •Compliance documentation
💡Pro Tips
- →Set up compliance calendar
- →Join dealer associations
Understanding what you need before you start will ensure a smooth licensing process.
🏢Office Space
Minimum 200 sq ft office space
Enclosed office area for conducting business and customer meetings
Dedicated customer waiting/meeting area
Comfortable space for customers during transactions
Minimum 3-5 vehicle display spaces
Designated area for showcasing inventory vehicles
Professional business signage
Visible sign displaying business name and license number
🛡️Insurance Coverage
General Liability
Protects against claims of bodily injury or property damage caused by business operations
Garage Liability
Covers damage to customer vehicles while in your possession for service or storage
Errors & Omissions
Protects against claims of professional negligence or failure to deliver promised services
Property Insurance
Covers building, equipment, inventory, and other business property
🎓Education & Training
Pre-License Seminar
8 hours (typically 1 day) mandatory education covering dealer laws and regulations.
Key Topics:
- • Federal and state dealer regulations
- • FTC Used Car Rule compliance
- • Truth in Lending Act requirements
- • Odometer disclosure requirements
Transparent pricing with no hidden fees. Plan your investment with confidence.
Minimum Investment
Basic setup with essential requirements
Average Investment
Professional setup with growth potential
Premium Investment
Complete setup with premium features
Detailed Cost Breakdown
licensing
location
insurance
bond
equipment
software
working Capital
Join the ranks of successful dealership owners who chose Universal Auto Brokers to launch their automotive business.
"Universal Auto Brokers made the impossible possible. They guided us through every step and we were selling cars within 90 days."